Rules of Origin and EPAs: What has been agreed? What does it mean? What next?

Rules of Origin (RoO) describe the local processing requirements necessary for a good to be considered as being of local origin and hence qualify for preferential market access under a given preferential trade agreement. As such, the Cotonou Agreement’s RoO have been a core determinant of preferential market access under EU-ACP trade relations. As part of the EPA, a number of aspects of the RoO were changed: others continue to impose a significant burden on stakeholders engaged in trade between ACP countries and the EU. However, these changes apply only to signatories of interim or full EPAs, while the remaining ACP States are now subject to the more onerous market access provisions of the GSP and EBA arrangements.

Some key findings of the paper are:

EPA RoO are largely similar to the Cotonou RoO

Changes to RoO were only implemented in a few sectors, including textiles and clothing, fish and certain agricultural products. With the exception of textiles and clothing, the changes to the rules do not represent a major departure from the previous RoO regime with respect to the majority of IEPA/EPA signatories.

While the Cotonou Agreement specified that no ACP country should be worse off under a new agreement with the EU, the current situation whereby only 35 countries initialled an agreement means that the previously broad cumulation provisions for the ACP are no longer in place, while the objective of regional economic integration is undermined by the somewhat fragmented coverage of interim EPAs as well as the lacking overlap with existing regional integration initiatives.